HKScan - nothing's well

Having served as EVP of HKScan’s Consumer Business in Finland and the Baltics and as HKScan Finland’s General Manager about one and a half year, Anne Mere has now been appointed Chief Marketing Officer of HKScan Group.  Practically speaking, she has got fired. Perhaps she was too professional and sought effective solutions of a kind producers’ cooperative or Finnish workers did not accept. It is HKScan’s problem, not Mere’s.  I guess she receives a dozen of great job offers every day, while still taking care of some HKScan’s meaningless strategy issues whatever.  In a newspaper Äripäev’s interview Mere tells, that the new position does not require residence in Finland and she decided to move back to Estonia.

In fact, the case seemed clear already in last March, and even on this blog we observed that nothing had changed, no significant renovations were made.  At that time is was a big disappointment considering what was written on this blog last October: Overall, the management team has changed a lot.  There is one new person, full of promise, fully proven to achieve results.  Anne Mere, HKScan’s only hope, an Estonian.

I will stay with the statement until otherwise proven.  HKScan does not have any hope.  Maybe it is an exaggeration, maybe not.  One must note that the company has a long, long history and it is almost necessary to add here a link to a video which outlines HKScan's 100-year journey. The documentary itself won awards at the 18^th Aurora Awards international film competition in the United States in August.

Hannu Kottonen, CEO HKscan, has been crying poor results.   And he has found lots of reasons:  expensive feed, private labels, low demand, aging population, recession, surplus of meat and also lack of meat, for instance. Now he has reacted: the Group’s earnings targets were lowered, amusing indeed.

In an interview in the magazine Kotitilalta 2/2013 Kottonen complains HKScan’s cultural mosaic, its local companies with local practices.  But elsewhere in the same interview, he says, that he wants to try to ensure that the Group is perceived as a local food company. There is still one specifically alarming comment in the interview. Kottonen hopes that rapeseed pork will be a success.  Isn't it already a success?  As far as I understand, HKScsan has praised the popularity of the whole rapeseed pork product family both in Finland and in Sweden.

One positive thing there is, namely the price of feed may be decreasing.  The harvest is expected to be good in many important production areas, the magazine says.  One can conclude that it is very important for the producers, because Kotitilalta 3/2013 tells us that in meat production feed costs account for 40 to 65 percent of total costs.

Matti Murto, producers' co-operative, chairman of the board, has in turn said in the newspaper Maaseudun Tulevaisuus, that Southern Finland’s 141 subsidies are terribly important because for many farmers they are what you are left with after costs. If I get it right, vast majority of the HKScsan’s pork producers locate in the 141 area.  Negotiations on the future of the whole Article 141 are currently in progress. Reductions are now likely and within a few years these subsidies will be discontinued.

We will discuss HKScan later but on Friday, September 27^th, we are going to look at Atria’s businesses.  Words like birds / go away / here I stay.  Yes, DIY again. I’m awfully sorry.

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